Digitalization in manufacturing remains a mystery for 76% of companies. Most manufacturers haven’t developed a strategy, and 70% of organizations fail at digital transformation attempts.
Many companies hesitate to start, which makes sense. Manufacturing’s digital shift can be overwhelming, with lots of new technology and methods to learn. Companies that achieve digital maturity in manufacturing generate up to three times higher annual revenue growth than their less-digitally-advanced competitors. Manufacturing process digitalization provides practical solutions to ground problems through IoT sensors and AI-powered analytics.
Your company could improve safety, boost quality, increase throughput, and reduce costs all at once. Successful digitalization in manufacturing makes this possible. Live data leads to quicker decisions, while predictive analytics improve future processes. Companies report that upskilling during digital initiatives has increased efficiency by over 90%.
This piece will show you where to begin your digitalization in manufacturing experience and what to expect. You’ll find practical steps to revolutionize your operations, attract talent, and secure your company’s future success, without any confusing jargon.
Table of contents
Understand What Digitalization Means for Your Factory
Most manufacturers face a basic question: What does going digital really mean? You need to be clear about your goals before spending money on fancy technology.
Let’s clear things up. Three terms might sound alike but mean totally different things. The differences between them can shape your strategy and results.
Digitization Vs. Digitalization Vs. Transformation
Digitization simply converts analogue information to digital format. It changes to “how you record” rather than “how you work.” This marks the first step in your digital experience.
Digitization essentially refers to taking analogue information and encoding it into zeroes and ones so that computers can store, process, and transmit such information. This is what it all means:
- Converting paper blueprints into CAD files
- Scanning paper-based work orders into PDFs
- Turning manual equipment readings into electronic data
- Replacing physical filing systems with digital storage
Digitalization in manufacturing takes things further. This technology boosts efficiency. It’s revolutionary; it’s not just a new filing system. We’re talking about entirely new workflows.
While digitization focuses on converting and recording data, digitalization is all about developing processes and changing workflows to improve manual systems. Manufacturing companies do this by:
- Using sensors to monitor equipment performance
- Setting up digital workflows that replace manual processes
- Building dashboards that show live insights
- Automating quality control procedures
Digital transformation brings the biggest change. “Digital transformation is all about the re-imagining of business in the digital age”. Don’t just tweak things; revamp your entire business model and strategy.
These differences matter because only 24% of manufacturing companies have a digital transformation strategy. Over 40% haven’t started implementation. About 70% of organizations fail during their digital transformation attempts.
Why Definitions Matter Before Action
Clear definitions help avoid expensive mistakes. Many manufacturers buy technology without knowing what level of change they want. This wastes resources on mismatched initiatives.
“It’s important to get your house in order before jumping into a full digital transformation strategy. A company should first look at digitizing their current data, then using that new data to digitalize their workflows and processes”.
Understanding these differences helps you:
- Set proper expectations with leadership and teams
- Use resources well across your initiatives
- Track success at each stage
- Talk clearly about goals and results
Here’s a real-life example: investing in advanced AI analytics (transformation) makes no sense if you still record data by hand. You should digitize your information collection systems first.
According to LineView, manufacturing process digitalization isn’t just one project, it’s a step-by-step experience. Industry experts say, “These three concepts are vital for organizations to adapt to the ever-changing business environment”.
Many manufacturers think buying software equals digital progress. But new software without changed processes rarely adds value. Digitalization increases process efficiency and improves data transparency, and of course, it should help boost your top line.
While digitization and digitalization in manufacturing concentrate on technology, digital transformation prioritizes customer satisfaction and generating new value. It’s a different focus entirely.
Ask yourself before starting any tech project: Are we digitizing, digitalizing, or transforming? What you say next depends entirely on this answer.
Map Your Current Digitalization in Manufacturing Processes
Manufacturing process digitalization starts with a clear understanding of your current setup. Understanding your processes first makes choosing the right digital tools much easier.
You can’t make improvements without visibility. The fancy technological solutions can wait – first you need a detailed picture of your current operations. See your factory floor in action, this map shows it all.
Identify Manual and Paper-Based Workflows
Take 1–3 days to watch your factory floor closely. Your engineers and technicians can pinpoint exactly where those old paper systems are causing trouble. Look for these specific issues:
- Errors from outdated instructions
- Time wasted creating and updating documentation
- Knowledge gaps from employee turnover
- Manual data entry points
Manufacturing might be the only industry where people will assemble rockets to shoot into space or high-end electric vehicles while holding pieces of paper giving them instructions on what to do next. These paper processes do more than just slow things down – they hurt your profits.
Old-fashioned paper systems really mess things up for businesses. Manual data entry leads to human errors and takes too much time. On top of that, production data on paper becomes hard to sort, reference, and analyze. This forces you to react to problems from yesterday.
Create a simple flowchart of your manufacturing process to start. Document each step, decision point, input, and output from raw materials to finished product. See how different parts of your operation are linked? This visual map reveals it all.
Lots of companies have trouble because their work processes don’t connect well. One expert explains that “production processes in the past store data locally which made it difficult to share information or coordinate between different entities within one company”.
Note that business process mapping goes beyond documentation – it’s strategic planning in visual form. The people doing the actual work should be involved. Your operators, technicians, and floor managers often see things that management might miss.
Spot Inefficiencies and Bottlenecks
Bottlenecks in manufacturing can reduce productivity by up to 40%. That’s a huge amount of potential output going to be wasted. Spotting these bottlenecks makes things run smoother.
See where things get stuck? Value stream mapping shows you, so you can fix it. Imagine having all the information and materials for your manufacturing process readily available.
This lean manufacturing technique makes that happen with a simple visual guide.
These signs point to bottlenecks quickly:
- Long wait times between process steps
- Work piling up at specific stations
- Delayed movement of materials
- Consistently missed delivery schedules
- Machines requiring irregular maintenance
The easiest way to find bottlenecks is to look for where production piles up the most. A buildup of materials or products at one point shows your bottleneck.
Research shows that humans still handle 72% of factory tasks. These manual processes often run without monitoring or analysis, which creates blind spots affecting efficiency and quality.
Manufacturers who skip proper analysis risk missing chances to:
- Identify and eliminate bottlenecks
- Reduce defect rates
- Standardize workflows across shifts
The numbers tell us that the average cost of downtime per manufacturing plant in a year averages USD 172.00 million. Mapping your processes now saves you from this pain later.
Once you can see the whole process laid out, the inefficiencies become obvious. Those three approval steps everyone thought they needed? Two might be completely unnecessary.
Conclusion
Digitization and transformation are all different. Understanding these differences is key to making good decisions. Mapping your current processes shows exactly where technology can have the biggest effect. Starting with low-risk, high-effect areas for your original projects will generate quick wins that build momentum.
Your technology choices must solve ground problems. The right mix of IoT sensors, cloud platforms, and AI tools is vital for success. Even perfect technology fails when people don’t welcome it. Team members need proper training, honest communication about job security, and digital champions who inspire others.
Data remains central to manufacturing’s digital revolution. Break down the walls between different parts, and watch a complete system emerge: machines, people, and systems working together. Information flows freely. Regularly assess and enhance your digital journey. It’s a continuous process. Improving your process is easier when you track key performance indicators and get feedback. This allows for adjustments before broader implementation of successful programs.
Companies that hesitate risk falling behind. Want better safety, higher quality, increased production, and reduced expenses? Try these eight steps. They really work!
Digital transformation doesn’t have to happen overnight. Start small with digitalization in manufacturing, learn continuously, and build upon each success instead of attempting everything at once. Tomorrow’s manufacturing leaders will take their first digital steps today. Think you’ll fit in? We’d love to have you.
